Bloomberg

Bloomberg | Quint is a multiplatform, Indian business and financial news company. We combine Bloomberg’s global leadership in business and financial news and data, with Quintillion Media’s deep expertise in the Indian market and digital news delivery, to provide high quality business news, insights and trends for India’s sophisticated audiences.

A New Yorker’s Guide to the Sudden Upheaval in Uber and Taxi Fares

(Bloomberg) -- New Yorkers hustling from here to there suddenly have a lot of carfare changes to keep track of. It seems every imaginable vehicle but the subway now costs more than it did just a few days ago -- and the train plays its own subterranean part in the drama.

To keep it straight, take it in three bites: New York City’s new minimum wage for drivers, New York State’s new surcharge on rides, and a trio of lawsuits swirling around both.

The Drivers

What happened: New York City’s Taxi and Limousine Commission signed off on a rule in December requiring that drivers for app-based ride-hailing services Uber Technologies Inc., Lyft Inc., Juno and Via earn at least $17.22 an hour.

What led to it: It’s part of Mayor Bill de Blasio’s effort to boost workers’ wages and cap the rapid growth of the ride-for-hire platforms to reduce traffic congestion.

Costs and benefits: Uber passengers will pay more, though the company wouldn’t say how much more, and it isn’t clear whether the other app-based ride services will follow suit. Drivers get a more dependable wage, though Uber said Friday it will narrow some perks as a result.

New Yorkers navigating the streets by car, whether behind the wheel or otherwise, may eventually see less gridlock, but efforts to impose congestion pricing on personal vehicles are stuck in traffic.

The Rides

What happened: A New York State law imposed surcharges on rides below 96th Street in Manhattan.

What led to it: A state panel last year proposed a congestion-pricing plan affecting all motorists entering Manhattan’s central business district. This is what survived. As important, it’s intended to provide as much as $400 million a year to the city’s ailing subway system.

Costs and benefits: If you hail one of New York City’s limited fleet of about 13,600 yellow cabs and 3,566 green taxis, or certain other for-hire vehicles, you’ll pay a surcharge of $2.50 on top of the ride’s base rate. If you call one of the app-based services like Uber or Lyft, the surcharge is $2.75 or, if it’s a group ride, 75 cents.

The Lawsuits

Lyft and Juno on Wednesday sued to block New York City’s minimum wage. Lyft claimed the rule, which ties the wage to how often drivers have a rider in their vehicles, gives “an automatic and perpetual advantage” to industry leader Uber. Juno, which has tried to position itself as a more generous alternative for drivers, claimed the rule would “destroy competition in the New York City ride-hail market.” A spokesperson for Uber declined to comment. State Supreme Court Judge Andrea Masley set a March 18 hearing and offered app-based companies the option of placing the additional pay in escrow pending her decision.

A group of cab owners in December sued New York State, claiming its surcharges violate the U.S. and New York constitutions. The New York Taxi Workers Alliance dubbed the $2.50 fee a “suicide surcharge” -- a reference to drivers, facing debt and competition from app-based services, who have taken their own lives -- that would cost an average driver as much as $15,000 a year. State Supreme Court Judge Lynn Kotler on Thursday permitted the state to collect the extra fees beginning at 12:01 a.m. Saturday while the suit goes forward. Kotler denied the state’s request to dismiss the case.